Jury in Harvey Cedars Case Awards $300 (!)

As takings mavens will recall, on May 13, 2013, the New Jersey Supreme Court issued its decision in Borough of Harvey Cedars v. Karan, reversing a $375,000 jury verdict for shorefront property owners on Long Beach Island who complained that a new artificial dune created as part of a government-financed storm-protection project obstructed their view of the ocean. The project involved the taking of a piece of plaintiffs’ lot (and land belonging to many other owners up and down the coast), and there was no dispute they were entitled to compensation for the taking of their property. The issue in the case was whether the just compensation award should be reduced to reflect the increase in value of the remainder of the property, including their house, due to the economically-valuable storm protection provided by the project. The lower courts had ruled that the storm protection was a “general benefit,” rather than a “special benefit,” and therefore could not be used to offset the compensation due for the taking. The Supreme Court reversed, casting aside the antiquated distinction special and general benefits, and adopting a new standard: “when a public project requires the partial taking of property, ‘just compensation’ to the owner must be based on a consideration of all relevant, reasonably calculable, and non-conjectural factors that either decrease or increase the value of the remaining property.” The Court remanded the case so that the trial court could hold a new trial using the correct standard,

According to local press reports, the other shoe has now dropped, and a new jury has awarded the property owners in the Harvey Cedars case the paltry sum of $300, implicitly concluding that the economic benefit conferred on the property owners by the project was essentially equal to the economic loss they suffered as a result of the taking for the new artificial dune blocking their view. For the property owners’ sake, one has to hope that they had a contingent-fee arrangement for this long, disappointing trip through the judicial system. The jury’s award vindicates Governor Chris Christie, who famously railed against landowners seeking windfall takings awards based on post-Sandy beach protection/restoration projects. And now, whatever their other faults, beach protection and restoration projects can at least proceed without burdening taxpayers with the duty to pay unjust takings awards.